Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from George Staphos - Bank of America.
George Staphos - Bank of America
I just wanted to get a sense Steve, for what kind of sequential trends you’re seeing heading into the third quarter in some of the harder hit areas?
Peter Pfeiffer
George, from the end of the second quarter, we have seen some increases in order inflow, especially in the personal care market. We have seen some of the increase in coming orders also on the low end of the fragrance/cosmetics markets, but we still have a very short visibility at the high end of the market in the fragrance/cosmetics.
So, it seems that the situation is continuing as in the past. What we are still seeing is a pretty high activity on new product developments. Projects also in the higher end of the market is ongoing, the problem is there that we do not really know when these products will come to the market.
Steve Hagge
Again maybe, George on the Closures side, if you look at the business, overall business we started to see picking up in the second quarter. That was really our first segment that started to go down about a year ago. So, I think that is a bit encouraging. We expect that to continue as we go into the third quarter and overall Pharma backlogs continue to be pretty consistent where they’ve been in the past.
George Staphos - Bank of America
When you look at the supply chain, I realize it is very, very difficult especially within fragrance/cosmetics. Clearly you’ve seen some pickup in orders that’s a positive. What visibility do your customers have on the supply chain and what inventory might remain that needs to be purged if any? At this juncture, what’s their read on the consumer and what kind of holiday selling season we might have within fragrance and cosmetic?
Peter Pfeiffer
There it is still very difficult to get a clear answer from our customers. Their visibility themselves seems to be as unclear as ours is. What we are seeing is that the Eastern markets for example Russia, especially in the high end of the fragrance/cosmetics market has basically disappeared. This was one of the growth reasons in the last years, two years.
There we are seeing a major drop in the demand. On the European and North American markets, it seems that the drop is not as big and we are still seeing some reduction in the supply chain. That is the reason why it is not coming up, picking up as quickly as we thought it was.
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